PUBLISHED OPINION
Case No.: 96-0487
Complete
Title
of
Case:LIBERTY MUTUAL
FIRE INSURANCE COMPANY,
Plaintiff-Appellant,
v.
KEVEN O'KEEFE AND PARKE O'FLAHERTY,
LTD.,
Defendants-Respondents.
Submitted
on Briefs: September 6, 1996
COURT COURT OF
APPEALS OF WISCONSIN
Opinion
Released: October 17, 1996
Opinion
Filed: October
17, 1996
Source
of APPEAL Appeal from a judgment
Full
Name JUDGE COURT: Circuit
Lower
Court. COUNTY: Lafayette
(If
"Special" JUDGE: William
D. Johnston
so
indicate)
JUDGES: Eich, C.J., Dykman, P.J., and Roggensack,
J.
Concurred:
Dissented:
Appellant
ATTORNEYSFor the plaintiff-appellant the
cause was submitted on the briefs of Robert J. Dreps and Debbie K.
Lerner of La Follette & Sinykin of Madison.
Respondent
ATTORNEYSFor the defendants-respondents the
cause was submitted on the brief of John W. Markson and Teresa A.
Mueller of Bell, Metzner, Gierhart & Moore, S.C. of
Madison.
COURT OF
APPEALS DECISION DATED AND
RELEASED October
17, 1996 |
NOTICE |
A party may file with the Supreme Court a petition to review an
adverse decision by the Court of Appeals.
See § 808.10 and Rule
809.62, Stats. |
This opinion is subject to further editing. If published, the official version will appear in the bound
volume of the Official Reports. |
No. 96-0487
STATE OF WISCONSIN IN
COURT OF APPEALS
LIBERTY
MUTUAL FIRE INSURANCE COMPANY,
Plaintiff-Appellant,
v.
KEVIN
O'KEEFE AND PARKE O'FLAHERTY, LTD.,
Defendants-Respondents.
APPEAL
from a judgment of the circuit court for Lafayette County: WILLIAM
D. JOHNSTON, Judge. Affirmed.
Before
Eich, C.J., Dykman, P.J., and Roggensack, J.
DYKMAN,
P.J. Liberty Mutual Insurance Company appeals from a summary
judgment dismissing its defamation claim against attorney Kevin O'Keefe and
Parke O'Flaherty, Ltd., O'Keefe's law firm.
The dispositive issue is whether a newspaper advertisement that O'Keefe
placed in a newspaper circulated within Liberty Mutual's coverage territory is
capable of a defamatory meaning. We
conclude that it is not and therefore affirm.
O'Keefe
represented a client in a bad faith claim against Liberty Mutual. As part of his discovery attempts, he ran
the following advertisement in a newspaper:
ATTENTION
There is a lawsuit pending in Crawford County
Circuit Court against Liberty Mutual Fire Insurance Company of Stitzer,
WI. This suit arises out of a
loss/claim caused by a barn fire.
If anyone has any information regarding Liberty
Mutual Fire Insurance Company's delay or failure to pay claims or losses,
please contact the undersigned.
Kevin
O'Keefe, Attorney
Jody
Dorschner, Legal Asst.
PARKE
O'FLAHERTY, LTD.
201 Main Street
LaCrosse,
WI 54602-1147
1-800-658-9448
Liberty
Mutual demanded that O'Keefe retract what it considered the advertisement's
defamatory material contained in the sentence:
"If anyone has any information regarding Liberty Mutual Fire
Insurance Company's delay or failure to pay claims or losses
...." (Emphasis added.) O'Keefe refused, and Liberty Mutual began
this lawsuit.
Summary
judgment methodology is well known, and we need not repeat it here. See State Bank v. Elsen,
128 Wis.2d 508, 511-12, 383 N.W.2d 916, 917-18 (Ct. App. 1986). Whether O'Keefe's advertisement is capable
of a defamatory meaning is a question of law.
Bauer v. Murphy, 191 Wis.2d 517, 523, 530 N.W.2d 1, 3 (Ct.
App. 1995). A communication is
defamatory "if it tends so to harm the reputation of another as to lower
him [or her] in the estimation of the community or to deter third persons from
associating or dealing with him [or her]." Id.; see Restatement
(Second) of Torts § 559 (1977).
Words charging dishonorable, unethical or unprofessional conduct in a
trade, business or profession are capable of a defamatory meaning. Converters Equip. Corp. v. Condes
Corp., 80 Wis.2d 257, 263, 258 N.W.2d 712, 715 (1977). In determining whether a communication is
defamatory, we must reasonably interpret the words "in the plain and
popular sense in which they would naturally be understood in the context in
which they were used and under the circumstances they were uttered." Tatur v. Solsrud, 174 Wis.2d
735, 741, 498 N.W.2d 232, 234 (1993).
If we conclude that statements are capable of both a defamatory and a
non-defamatory meaning, we must reverse and remand for trial, for in that
instance, the ultimate determination is for the jury. Zinda v. Louisiana Pac. Corp., 149 Wis.2d 913, 921,
440 N.W.2d 548, 552 (1989).
There
are many reported defamation cases, both in Wisconsin and elsewhere. The principles that we have mentioned are
well known. The cases provide a varied
and interesting report on material that courts have found to be defamatory or
non-defamatory. See cases
annotated in 50 Am. Jur. 2d Libel
and Slander § 215 (1995) and 53 C.J.S. Libel and Slander
§§ 28-37 (1987 & Supp. 1996).
But it is not helpful here that accusing a corporation of
"masquerading as a charitable enterprise simply to obtain preferential tax
treatment" is defamatory, Fields Found., Ltd. v. Christensen,
103 Wis.2d 465, 483, 309 N.W.2d 125, 134 (Ct. App. 1981), or that an insurance
company's statement that it had declined to renew the plaintiff's insurance
policy due to "loss frequency" is not capable of a defamatory meaning
because at worst the words implied that the plaintiff was accident prone, Levy
v. American Mut. Liab. Ins. Co., 196 A.2d 475, 476-77 (D.C. 1964). We have found no case directly on
point.
Liberty
Mutual refers us to Continental Casualty Co. v. Southwestern Bell Tel.
Co., 860 F.2d 970 (10th Cir. 1988), cert. denied, 489 U.S. 1079
(1989), to support its assertion that accusing an insurance company of delay or
failure to pay claims is defamatory.
There, an officer of Southwestern Bell Telephone wrote an internal
memorandum which read in pertinent part:
As a
general rule, the insurance carriers for [our sub-contractors] have responded
promptly and resolved those claims that are legitimate.
One exception to this has been Continental
Casualty Company (CNA). On numerous
occasions they have denied valid claims, ignored claimants, refused to
cooperate with us, etc. We have been
exposed to potential lawsuits and our reputation as a responsible corporate
citizen has been damaged because of CNA's attitude and methods.
For these reasons,
we strongly recommend that bids no longer be accepted from contractors who are
insured by CNA.
Id. at 971-72.
But
in Southwestern Bell, the defendant accused an insurance company
of failing to pay valid claims and ignoring claimants. There is a significant difference between
this accusation and suggesting that an insurance company delayed or failed to
pay claims. There are many bona fide
reasons why an insurance company may delay in paying a claim. The insured's delay in submitting a proof of
loss or a sudden and substantial influx of claims caused by a significant
disaster are two. And insurance companies
are not required to pay all claims or losses, but only those covered by their
insurance policies. One would not
expect an insurance company that does not issue automobile policies to pay
damages caused by an automobile accident if the policy clearly excludes that
coverage.
We
are to consider O'Keefe's words in the plain and popular sense in which they
would be naturally understood in their context and under the circumstances in
which they are found. Tatur,
174 Wis.2d at 741, 498 N.W.2d at 234.
The context is now a familiar one.
An attorney is advertising for witnesses, or perhaps clients. The need for witnesses in a fire loss claim
against an insurance company is not an unusual situation. Insurance companies are often sued. The word "if" dilutes Liberty's
suggestion that a reader would naturally understand the "delay or
failure" statement to accuse Liberty of habitually treating its
policyholders unfairly. And, as we have
explained, there are many legitimate reasons why an insurance company would not
immediately pay all claims, a fact which is widely understood.
We
regard O'Keefe's statements as a slightly more serious situation than seen in Isaksen
v. Vermont Castings, Inc., 825 F.2d 1158 (7th Cir. 1987), cert.
denied, 486 U.S. 1005 (1988). The
court concluded:
But not every slight is a slander or libel. The courts of Wisconsin ... require a
threshold determination by the trial court that the imputation "tends so
to harm the reputation of another as to lower him in the estimation of the
community or deter third persons from associating or dealing with
him." ... More is necessary than a diminution of
transactional opportunities. In a
business setting the imputation, to count as defamation, must charge
dishonorable, unethical, unlawful, or unprofessional conduct.... To imply that
a person is not a dealer in Vermont Castings' free-standing woodburning stoves
is not to place the commercial equivalent of the mark of Cain on him.
Id. at 1165-66 (citations omitted).
We
conclude that a reader of O'Keefe's advertisement might be curious about the
facts of O'Keefe's case. But O'Keefe is
identified as an attorney, and it is commonly known that attorneys sue
insurance companies. It is also
commonly known that some cases are won while others are lost. In its plain and popular sense, and in the
context used, the entire statement would be interpreted as a lawyer's fishing
expedition, not a statement about Liberty Mutual's business ethics. While, as Liberty Mutual asserts, it would
have been better had O'Keefe asked for "any information that Liberty
Mutual has ever delayed or failed to pay claims or losses," thus avoiding
this lawsuit, the words he used in their context are not capable of a
defamatory meaning. We therefore affirm
the trial court's summary judgment dismissing Liberty Mutual's complaint.[1]
By
the Court.—Judgment affirmed.
[1] The trial court ordered Liberty Mutual's
complaint dismissed because it concluded that O'Keefe's advertisement was
absolutely privileged. We do not reach
this issue. We may affirm a trial court's
determination for reasons not stated by the trial court if we agree with the
trial courts conclusion. Kafka v.
Pope, 186 Wis.2d 472, 476, 521 N.W.2d 174, 176 (Ct. App. 1994), aff'd,
194 Wis.2d 234, 533 N.W.2d 491 (1995).